DHI Group, Inc. Reports Fourth Quarter and Full Year 2018 Earnings Results

Reaches Inflection Point in Ongoing Tech-Focused Revenues

NEW YORK, New York February 7, 2019 - DHI Group, Inc. (NYSE: DHX) (“DHI” or the “Company”), today announced the following results for the fourth quarter ended December 31, 2018:

▪ Revenues were $38.0 million; Ongoing tech-focused revenues¹ were unchanged year over year for the first time in nearly 3 years

▪ Net income was $2.9 million, or $0.06 per diluted share

▪ Cash flow from operations of $6.2 million; Adjusted EBITDA² was $8.3 million and Adjusted EBITDA margin² was 22%

"We ended 2018 with strong momentum, reaching an important inflection point in our business," said Art Zeile, President and Chief Executive Officer of the Company. “We stabilized our ongoing tech-focused revenues¹, improved our profitability and made significant progress in delivering against our tech-focused strategy. We put in place a strong, execution-oriented management team and began implementing a culture of customer-focused innovation. We are well positioned to achieve our 2019 strategic growth plan."

Quarterly Financial Highlights

• Ongoing tech-focused revenues¹ of $38.0 million were unchanged year over year

• Dice³ revenues were $24.0 million, down 4% compared to the prior year period, the third sequential quarter in which this decrease narrowed

• eFinancialCareers revenues were $8.3 million, 2% higher versus the prior year period, excluding foreign exchange

• ClearanceJobs revenues were $5.7 million, 22% higher year over year, the twelfth consecutive quarter of at least 20% year over year revenue growth

• Improved metrics for Dice recruitment package customers

▪ 6,200 customers, 4% lower year over year, but unchanged sequentially for the third consecutive quarter, achieving stability for the first time in several years

▪ Quarterly customer renewal rate of 67%, revenue renewal rate of 78% and monthly revenue per recruitment customer of $1,129

▪ Debt outstanding was $18 million as of December 31, 2018, a 57% decrease year over year

¹ Excludes Dice Europe, which ceased operations August 31, 2018.

² See "Notes Regarding the Use of Non-GAAP Financial Measures" later in this press release.

³ Includes Dice U.S. and Targeted Job Fairs.

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"We are very pleased with the progress we made in delivering against our financial priorities in 2018, particularly the turning point reached in our ongoing tech-focused revenues¹," said Luc Gregoire, Chief Financial Officer. "Our efficiency initiatives also drove improved margins over the past few quarters, even as we invested in our business. We are seeing this positive momentum carry into 2019, where we expect to pivot to top-line growth and improved profitability."

Quarterly Business Highlights

Dice

▪ Completed migration of 76% of Dice customers to TalentSearch with Intellisearch, with positive feedback and a double digit increase in usage.

ClearanceJobs

▪ Launched Next Generation, a new platform thathelps recruiters source and engage cleared talent quickly through sophisticated technology and communications tools. Next Generation includes large-scale improvements to user workflows, a fully re-designed messenger app that includes live chat and deeper integration of ClearanceJobs Voice.

▪ Continued to outperform all financial and operational goals, as well as hitting a new record for job postings and candidate connections in the fourth quarter. A key driver of ClearanceJobs' success is its unique user experience with high levels of interaction, which doesn't exist anywhere else in the market for connecting specialized, hard-to-find and skilled talent to employers.

eFinancialCareers

▪ Made solid progress with its Matchback program. This program works with bank human resource leaders to directly tie the hires they make to applications processed on eFinancialCareers' platform.  For example, the eFinancialCareers team demonstrated to a Global 500 bank that eFinancialCareers had sourced 1,352 hires to the bank in eighteen months, saving the equivalent of $30 million in search fees.

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Summary Financial Results

($ in millions, except per share data)

	Q4 2018		Q4 2017		Change	Fx Impact
Revenues
Tech-focused(1)	$	38.0	$	39.8	(4)%	$	(0.2	)
Healthcare (2)	—		4.6		n.m.	—
Corporate & Other (2)	—		6.5		n.m.	—
Total Revenues	$	38.0	$	50.9	(25)%	$	(0.2	)
Net Income	$	2.9	$	11.8	(75)%
Diluted earnings per share	$	0.06	$	0.24	(75)%
Net cash flows from operating activities	$	6.2	$	7.2	(14)%

	YTD 2018		YTD 2017		Change	Fx Impact
Revenues
Tech-focused(1)	$	152.3	$	158.4	(4)%	$	1.1
Healthcare (2)	—		24.4		n.m.	—
Corporate & Other (2)	9.3		25.2		(63)%	—
Total Revenues	$	161.6	$	208.0	(22)%	$	1.1
Net Income	$	7.2	$	16.0	(55)%
Diluted earnings per share	$	0.14	$	0.33	(58)%
Net cash flows from operating activities	$	14.9	$	34.4	(57)%

	Adjusted Revenues (3) (4)						Adjusted EBITDA (3) (4)						Margin
Non-GAAP (3) (4)	Q4 2018		Q4 2017		Change		Q4 2018			Q4 2017			Q4 2018		Q4 2017
Tech-focused(1)	$	38.0	$	39.8	(4	)%	$	10.8		$	10.7		28	%	27	%
Corporate and other(2)	—		—		—	%	(2.5		)	(3.1		)	n.m.		n.m.
Total	$	38.0	$	39.8	(4	)%	$	8.3		$	7.6		22	%	19	%
	Adjusted Revenues (3) (4)						Adjusted EBITDA (3) (4)						Margin
Non-GAAP (3) (4)	YTD 2018		YTD 2017		Change		YTD 2018			YTD 2017			YTD 2018		YTD 2017
Tech-focused(1)	$	152.3	$	158.4	(4	)%	$	42.4		$	50.0		28	%	32	%
Corporate and other(2)	—		0.1		—	%	(10.4		)	(13.1		)	n.m.		n.m.
Total	$	152.3	$	158.5	(4	)%	$	32.0		$	37.0		21	%	23	%
(1) Dice Europe ceased operations on August 31, 2018, causing revenue declines for Q4 2018 and FY 2018 of $1.7 million and $4.1 million, respectively. See revenue detail table at the end of the release.
(2) Health eCareers was sold on December 4, 2017, majority ownership of the BioSpace business was transferred to BioSpace management on January 31, 2018, the RigLogix portion of the Rigzone business was sold on February 20, 2018, Hcareers was sold on May 22, 2018, and majority ownership of the remaining Rigzone business was transferred to Rigzone management on August 31, 2018.
(3) See "Notes Regarding the Use of Non-GAAP Financial Measures" later in this press release.
(4) Reconciliations of Revenues to Adjusted Revenues and Net Income, Operating Income, and Operating Cash Flows to Adjusted EBITDA are included toward the end of this press release.

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Revenues

Revenues were $38.0 million for the 2018 fourth quarter, 25% lower year over year. This decrease was attributable to the divestitures of the Company’s non-tech businesses and the closure of Dice Europe.

Ongoing tech-focused revenues¹ were unchanged year over year, due to a further narrowing of the rate of decline in Dice³ revenues, another quarter of record revenues in ClearanceJobs and modestly increased revenues in eFinancialCareers, excluding foreign exchange.

Operating Expenses

Operating expenses were $35.6 million for the fourth quarter, a $13.3 million, or 27%, year over year reduction, of which $10.6 million was attributable to the effect of the Company's divestitures of its non-core businesses and $1.7 million was attributable to Dice Europe. The remainder of the decrease was primarily driven by lower marketing and non-cash stock-based compensation expenses. These decreases were partially offset by increased general and administrative expenses, mainly due to consulting fees related to our expense reduction strategy.

Income Tax Expense

Income tax expense for the fourth quarter was a net benefit of $1.3 million, driven mainly by the reversal of $1.6 million of unrecognized tax benefits upon the conclusion of audits and the expiration of certain statutes of limitation.

Net Income

Net income for the fourth quarter was $2.9 million, or $0.06 per diluted share. This result includes the adverse effect of $2.4 million of disposition related and other costs, which was offset by beneficial income tax items in the quarter, including the unrecognized net tax benefit reversal described in the Income Tax Expense section above.

Operating Net Cash Flows

Operating net cash flows were $6.2 million for the fourth quarter, a decrease of $1.0 million year over year. This result was driven by a combination of lower income from the Company's tech-focused¹ and divested businesses along with changes the Company made to its billing terms, partially offset by tighter vendor payment management.

Adjusted EBITDA and Adjusted EBITDA Margin² 

Adjusted EBITDA² excludes the effects of the Company’s divested businesses, disposition-related and other costs, and loss on sale of businesses from both the current and prior year periods. This presentation provides for better comparability of results.

Adjusted EBITDA² for the quarter was $8.3 million for a margin² of 22%, compared to $7.6 million and 19%, respectively, for the 2017 fourth quarter. The 2017 fourth quarter included the effect of Dice Europe, which had a negative impact on the margin.

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Capital

Weighted average diluted shares outstanding in the fourth quarter was 49.5 million. In May 2018, the Company’s Board of Directors authorized a stock repurchase program that permits the purchase of up to $7 million of the Company's common stock. Under the plan, management has discretion in determining the conditions under which shares may be purchased. During the 2018 fourth quarter, the Company repurchased approximately 684,000 shares under this authorization, for a cumulative total of approximately 1.1 million shares since the repurchase program was authorized. The authorization will remain in effect until May 2019, unless terminated earlier by the Company, and approximately $5.0 million remains of the original authorization amount.

Repurchases will be made in accordance with applicable securities laws in the open market, in privately negotiated transactions or through other means. Depending on acquisition opportunities, market conditions and other factors, these repurchases may commence or cease from time to time without prior notice.

Business Outlook

Looking ahead, the Company believes that its ongoing tech-focused business¹ will achieve modest year over year revenue growth beginning in the first half of 2019, which should improve as the year progresses. The Company further anticipates that Dice³ will turn to positive year over year revenue growth in the 2019 second half. This year, the Company expects to make further progress on rationalizing its expenses, while at the same time investing prudently for growth, which should enable the Company to maintain its current level of Adjusted EBITDA margin in the first half and gradually begin to increase its margin in the second half. The Company is unable to provide guidance for net income because it cannot reasonably assess the impact of stock-based compensation and income tax expense.

¹Excludes Dice Europe, which ceased operations August 31, 2018.

² See "Notes Regarding the Use of Non-GAAP Financial Measures" later in this press release.

³ Includes Dice U.S. and Targeted Job Fairs.

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Conference Call Information

Art Zeile, President and Chief Executive Officer, and Luc Grégoire, Chief Financial Officer, will host a conference call today, February 7, 2019, at 8:30 a.m. Eastern Time to discuss the Company’s financial results, recent developments and progress on its tech-focused strategy.

The call can be accessed by dialing +1-866-393-4306 (in the U.S.) or +1-734-385-2616 (outside the U.S.) and entering the conference ID 9369039 or asking to be placed into the DHI Group, Inc. call. A live webcast of the call will simultaneously be available through the Investor Relations section of the Company’s website, http://www.dhigroupinc.comand available for replay after the call ends. 

Investor Contact

Arbor Advisory Group

212-448-4181

ir@dhigroupinc.com

Media Contact

Rachel Ceccarelli

Director of Corporate Communications

212-448-8288

media@dhigroupinc.com

About DHI Group, Inc.

DHI Group, Inc. (NYSE: DHX) is a leading provider of data, insights and employment connections through our specialized services for technology professionals and other select online communities. Our mission is to empower technology professionals and organizations that hire them to compete and win through expert insights and relevant employment connections. Employers and recruiters use our websites and services to source, hire and connect with the most qualified and highly-skilled technology professionals, while professionals use our websites and services to find ideal employment opportunities, relevant job advice and tailored career-related data. For over 25 years, we have built our Company on providing employers and professionals with career connections, news, tools and information. Today, we serve multiple markets in North America, Europe, the Middle East and the Asia Pacific region. Find out more at www.dhigroupinc.com.

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Notes Regarding the Use of Non-GAAP Financial Measures

The Company has provided certain non-GAAP financial information as additional information for its operating results. These measures are not in accordance with, or an alternative for, measurements in accordance with generally accepted accounting principles in the United States (“GAAP”) and may be different from similarly titled non-GAAP measures reported by other companies. The Company believes that its presentation of non-GAAP measures, such as Adjusted Revenues, adjusted earnings before interest, taxes, depreciation, amortization, non-cash stock based compensation expense, other non-recurring income or expense (“Adjusted EBITDA”) and Adjusted EBITDA margin provides useful information to management and investors regarding certain financial and business trends relating to its financial condition and results of operations. In addition, the Company’s management uses these measures for reviewing the financial results of the Company and for budgeting and planning purposes. The non-GAAP measures apply to consolidated results and results by segment or other measure as shown within this document. The Company has provided required reconciliations to the most comparable GAAP measures elsewhere in the document.

Adjusted Revenues

Adjusted Revenues is a non-GAAP metric used by management to measure operating performance. Adjusted Revenues represents Revenues less the revenues of divested businesses. We consider Adjusted Revenues to be an important measure to evaluate the performance of our ongoing businesses and provide comparable results excluding our divestitures.

Adjusted EBITDA and Adjusted EBITDA Margin

Adjusted EBITDA and Adjusted EBITDA Margin are non-GAAP metrics used by management to measure operating performance. Management uses Adjusted EBITDA as a performance measure for internal monitoring and planning, including preparation of annual budgets, analyzing investment decisions and evaluating profitability and performance comparisons between us and our competitors. The Company also uses this measure to calculate amounts of performance based compensation under the senior management incentive bonus program. Adjusted EBITDA represents net income plus (to the extent deducted in calculating such net income) interest expense, income tax expense, depreciation and amortization, non-cash stock based compensation, losses resulting from certain dispositions outside the ordinary course of business including prior negative operating results of those businesses, certain writeoffs in connection with indebtedness, impairment charges with respect to long-lived assets, expenses incurred in connection with an equity offering or any other offering of securities by the Company, extraordinary or non-recurring non-cash expenses or losses, transaction costs in connection with the credit agreement, deferred revenues written off in connection with acquisition purchase accounting adjustments, writeoff of non-cash stock compensation expense, severance and retention costs related to dispositions and reorganizations of the Company, losses related to legal claims and fees that are unusual in nature or infrequent, minus (to the extent included in calculating such net income) non-cash income or gains, interest income, business interruption insurance proceeds, and any income or gain resulting from certain dispositions outside the ordinary course of business, including prior positive operating results of those divested businesses, and gains related to legal claims that are unusual in nature or infrequent.

The Company modified its definition of Adjusted EBITDA during the first quarter of 2018 to also exclude severance and retention costs related to dispositions or reorganizations of the Company, the prior operating results of divested businesses, and losses related to legal claims and fees that are unusual in nature or infrequent.  The Company changed its definition of Adjusted EBITDA to provide a more transparent and comparable view of its financial performance.  Accordingly, all prior periods presented have been recast to reflect the current definition.

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We also consider Adjusted EBITDA, as defined above, to be an important indicator to investors because it provides information related to our ability to provide cash flows to meet future debt service, capital expenditures and working capital requirements and to fund future growth. We present Adjusted EBITDA as a supplemental performance measure because we believe that this measure provides our board of directors, management and investors with additional information to measure our performance, provide comparisons from period to period and company to company by excluding potential differences caused by variations in capital structures (affecting interest expense) and tax positions (such as the impact on periods or companies of changes in effective tax rates or net operating losses), and to estimate our value.

Adjusted EBITDA Margin is computed as Adjusted EBITDA divided by Adjusted Revenues. Adjusted Revenues, Adjusted EBITDA and Adjusted EBITDA Margin are not measurements of our financial performance under GAAP and should not be considered as an alternative to net income, operating income, revenue or any other performance measures derived in accordance with GAAP as a measure of our profitability.

Forward-Looking Statements

This press release and oral statements made from time to time by our representatives contain forward-looking statements. You should not place undue reliance on those statements because they are subject to numerous uncertainties and factors relating to our operations and business environment, all of which are difficult to predict and many of which are beyond our control. Forward-looking statements include, without limitation, information concerning our possible or assumed future results of operations. These statements often include words such as “may,” “will,” “should,” “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate” or similar expressions. These statements are based on assumptions that we have made in light of our experience in the industry as well as our perceptions of historical trends, current conditions, expected future developments and other factors we believe are appropriate under the circumstances. Although we believe that these forward-looking statements are based on reasonable assumptions, you should be aware that many factors could affect our actual financial results or results of operations and could cause actual results to differ materially from those in the forward-looking statements. These factors include, but are not limited to, our ability to execute our tech-focused strategy, competition from existing and future competitors in the highly competitive market in which we operate, failure to adapt our business model to keep pace with rapid changes in the recruiting and career services business, failure to maintain and develop our reputation and brand recognition, failure to increase or maintain the number of customers who purchase recruitment packages, cyclicality or downturns in the economy or industries we serve, the uncertainty surrounding the United Kingdom’s future departure from the European Union, including uncertainty in respect of the regulation of data protection and data privacy, failure to attract qualified professionals to our websites or grow the number of qualified professionals who use our websites, failure to successfully identify or integrate acquisitions, U.S. and foreign government regulation of the Internet and taxation, our ability to borrow funds under our revolving credit facility or refinance our indebtedness and restrictions on our current and future operations under such indebtedness. These factors and others are discussed in more detail in the Company’s filings with the Securities and Exchange Commission, all of which are available on the Investors page of our website at www.dhigroupinc.com, including the Company’s most recently filed periodic reports on Form 10-K and Form 10-Q and subsequent filings under the headings “Risk Factors,” “Forward-Looking Statements” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” You should keep in mind that any forward-looking statement made by the Company or its representatives herein, or elsewhere, speaks only as of the date on which it is made. New risks and uncertainties come up from time to time, and it is impossible to predict these events or how they may affect us. We undertake no obligation to update any forward-looking statements after the date hereof, except as required by federal securities laws.

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DHI GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(in thousands except per share amounts)
		For the three months ended December 31,						For the year ended December 31,
		2018			2017			2018			2017
Revenues		$	37,987		$	50,936		$	161,570		$	207,950
Operating expenses:
Cost of revenues		4,014			7,293			18,344			29,974
Product development		4,401			5,754			20,212			24,984
Sales and marketing		13,093			20,870			59,721			80,508
General and administrative		9,577			9,970			37,589			40,749
Depreciation		2,125			2,049			9,280			9,752
Amortization of intangible assets		—			452			482			2,138
Impairment of fixed and intangible assets		—			—			—			2,226
Disposition related and other costs		2,405			2,510			7,619			4,746
	Total operating expenses	35,615			48,898			153,247			195,077
Gain on (loss) sale of businesses, net		(66		)	6,699			3,369			6,699
Proceeds from restitution award		—			3,293			—			3,293
	Total other operating income	(66		)	9,992			3,369			9,992
Operating income		2,306			12,030			11,692			22,865
Interest expense		(684		)	(668		)	(2,054		)	(3,445		)
Other income (expense)		6			(13		)	(36		)	(23		)
Income before income taxes		1,628			11,349			9,602			19,397
Income tax (benefit) expense		(1,318		)	(409		)	2,428			3,419
Net income		$	2,946		$	11,758		$	7,174		$	15,978
Basic earnings per share		$	0.06		$	0.24		$	0.15		$	0.33
Diluted earnings per share		$	0.06		$	0.24		$	0.14		$	0.33
Weighted average basic shares outstanding		48,315			48,055			48,520			47,908
Weighted average diluted shares outstanding		49,547			48,400			49,605			48,230

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DHI GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)
		For the three months ended December 31,						For the year ended December 31,
		2018			2017			2018				2017
Cash flows from operating activities:
	Net income	$	2,946		$	11,758		$	7,174			$	15,978
Adjustments to reconcile net income to net cash flows from operating activities:
	Depreciation	2,125			2,049			9,280				9,752
	Amortization of intangible assets	—			452			482				2,138
	Deferred income taxes	869			235			2,699				212
	Amortization of deferred financing costs	196			48			342				690
	Stock based compensation	1,244			2,333			6,606				8,608
	Impairment of fixed and intangible assets	—			—			—				2,226
	Change in accrual for unrecognized tax benefits	(1,561		)	(2,012		)	(1,179		)		346
	(Gain) loss on sale of businesses, net	66			(6,699		)	(3,369		)		(6,699		)
Changes in operating assets and liabilities:
	Accounts receivable	(3,825		)	(8,631		)	11,947				1,976
	Prepaid expenses and other assets	50			(79		)	1,759				(1,120		)
	Capitalized contract costs	(1,649		)	—			(3,236		)		—
	Accounts payable and accrued expenses	5,923			1,811			1,743				1,659
	Income taxes receivable/payable	49			1,488			(972		)		(2,111		)
	Deferred revenue	(244		)	4,486			(18,866		)		712
	Other, net	39			(9		)	508				42
Net cash flows from operating activities		6,228			7,230			14,918				34,409
Cash flows from (used in) investing activities:
	Cash received from sale of businesses, net	—			12,947			17,542				12,947
	Purchases of fixed assets	(3,449		)	(3,062		)	(10,053		)		(13,222		)
	Purchases of cost method investments	—			—			—			—	(500		)
Net cash flows from (used in) investing activities		(3,449		)	9,885			7,489				(775		)
Cash flows used in financing activities:
	Payments on long-term debt	(1,000		)	(27,000		)	(31,000		)		(44,000		)
	Proceeds from long-term debt	2,000			—			7,000				—
	Payments under stock repurchase plan	(1,149		)	—			(1,977		)		—
	Proceeds from stock option exercises	—			—			—				403
	Purchase of treasury stock related to vested restricted stock and performance stock units	(146		)	(59		)	(693		)		(1,184		)
	Financing costs paid	(504		)	—			(504		)		—
Net cash flows used in financing activities		(799		)	(27,059		)	(27,174		)		(44,781		)
Effect of exchange rate changes		(167		)	(74		)	(829		)		228
Net change in cash for the period		1,813			(10,018		)	(5,596		)		(10,919		)
Cash, beginning of period		4,659			22,086			12,068				22,987
Cash, end of period		$	6,472		$	12,068		$	6,472			$	12,068

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DHI GROUP, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(in thousands)
ASSETS			December 31, 2018		December 31, 2017
Current assets
	Cash		$	6,472	$	12,068
	Accounts receivable, net		22,850		38,769
	Income taxes receivable		2,203		2,617
	Prepaid and other current assets		7,330		5,086
		Total current assets	38,855		58,540
Fixed assets, net			15,890		16,147
Acquired intangible assets, net			39,000		45,737
Capitalized contract costs			7,939		—
Goodwill			153,974		170,791
Deferred income taxes			136		469
Other assets			2,591		4,034
		Total assets	$	258,385	$	295,718
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
	Accounts payable and accrued expenses		$	25,030	$	22,196
	Deferred revenue		54,723		83,646
	Income taxes payable		1,168		1,129
		Total current liabilities	80,921		106,971
Long-term debt, net			17,288		41,450
Deferred income taxes			10,444		8,245
Deferred revenue			1,363		—
Income taxes payable			—		1,489
Unrecognized tax benefits			1,680		2,859
Other long-term liabilities			1,334		2,063
		Total liabilities	113,030		163,077
		Total stockholders’ equity	145,355		132,641
		Total liabilities and stockholders’ equity	$	258,385	$	295,718

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Supplemental Information and Non-GAAP Reconciliations

On the pages that follow, the Company has provided certain supplemental information that we believe will assist the reader in assessing our business operations and performance, including certain non-GAAP financial information and required reconciliations to the most comparable GAAP measure. A statement of operations and statement of cash flows for the three and twelve month periods ended December 31, 2018 and 2017 and balance sheets as of December 31, 2018 and 2017 are provided elsewhere in this press release.

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DHI GROUP, INC.
NON-GAAP SUPPLEMENTAL DATA
(Unaudited)
(dollars in thousands except per customer data)
		For the three months ended December 31,						For the year ended December 31,
		2018			2017			2018			2017
Reconciliation of Net Income to Adjusted EBITDA:
Net income		$	2,946		$	11,758		$	7,174		$	15,978
	Interest expense	684			668			2,054			3,445
	Income tax (benefit) expense	(1,318		)	(409		)	2,428			3,419
	Depreciation	2,125			2,049			9,280			9,752
	Amortization of intangible assets	—			452			482			2,138
	Non-cash stock based compensation	1,244			2,333			6,606			8,608
	Impairment of fixed assets	—			—			—			2,226
	(Gain) loss on sale of businesses, net	66			(6,699		)	(3,369		)	(6,699		)
	Costs related to strategic alternatives process	—			—			—			807
	Disposition related and other costs	2,405			2,510			7,619			4,746
	Proceeds from restitution payment	—			(3,293		)	—			(3,293		)
	Legal contingencies and fees	188			111			1,965			739
	Divested businesses	—			(1,896		)	(2,243		)	(4,916		)
	Other	(6		)	13			36			23
Adjusted EBITDA		$	8,334		$	7,597		$	32,032		$	36,973
Reconciliation of Operating Cash Flows to Adjusted EBITDA:
Net cash provided by operating activities		$	6,228		$	7,230		$	14,918		$	34,409
	Interest expense	684			668			2,054			3,445
	Amortization of deferred financing costs	(196		)	(48		)	(342		)	(690		)
	Income tax (benefit) expense	(1,318		)	(409		)	2,428			3,419
	Deferred income taxes	(869		)	(235		)	(2,699		)	(212		)
	Change in unrecognized tax benefits	1,561			2,012			1,179			(346		)
	Change in accounts receivable	3,825			8,631			(11,947		)	(1,976		)
	Change in deferred revenue	244			(4,486		)	18,866			(712		)
	Costs related to strategic alternatives process	—			—			—			807
	Disposition related and other costs	2,405			2,510			7,619			4,746
	Proceeds from restitution payment	—			(3,293		)	—			(3,293		)
	Legal contingencies and fees	188			111			1,965			739
	Divested businesses	—			(1,896		)	(2,243		)	(4,916		)
	Changes in working capital and other	(4,418		)	(3,198		)	234			1,553
Adjusted EBITDA		$	8,334		$	7,597		$	32,032		$	36,973
Dice Recruitment Package Customers
Beginning of period		6,200			6,650			6,450			7,050
End of period		6,200			6,450			6,200			6,450
Average for the period (1)		6,200			6,550			6,200			6,700
Dice Average Monthly Revenue per Recruitment Package Customer (2)		$	1,129		$	1,115		$	1,119		$	1,110
(1) Reflects the daily average of recruitment package customers during the period.
(2) Reflects the simple average of each period presented.

13

DHI GROUP, INC.
NON-GAAP SUPPLEMENTAL DATA (CONTINUED)
(Unaudited)
(in thousands)
		For the three months ended December 31, 2018
Reconciliation of Operating Income (Loss) to Adjusted EBITDA:		Tech-focused		Healthcare			Corporate & Other			Total
Operating income (loss)		$	7,125	$	—		$	(4,819	)	$	2,306
	Depreciation	2,110		—			15			2,125
	Non-cash stock based compensation expense	620		—			624			1,244
	Disposition related and other costs	964		—			1,441			2,405
	Legal contingencies and fees	—		—			188			188
	Loss on sale of businesses	—		—			66			66
Adjusted EBITDA		$	10,819	$	—		$	(2,485	)	$	8,334
		For the three months ended December 31, 2017
Reconciliation of Operating Income (Loss) to Adjusted EBITDA:		Tech-focused		Healthcare			Corporate & Other			Total
Operating income (loss)		$	7,762	$	(228	)	$	4,496		$	12,030
	Depreciation	1,724		174			151			2,049
	Amortization of intangible assets	24		109			319			452
	Non-cash stock based compensation expense	795		(161		)	1,699			2,333
	Disposition related and other costs	367		423			1,720			2,510
	Legal contingencies and fees	—		—			111			111
	Divested businesses	—		(317		)	(1,579		)	(1,896		)
	Gain on sale of businesses	—		—			(6,699		)	(6,699		)
	Proceeds from restitution payment	—		—			(3,293		)	(3,293		)
Adjusted EBITDA		$	10,672	$	—		$	(3,075	)	$	7,597
		For the twelve months ended December 31, 2018
Reconciliation of Operating Income (Loss) to Adjusted EBITDA:		Tech-focused		Healthcare			Corporate & Other			Total
Operating income (loss)		$	26,851	$	—		$	(15,159	)	$	11,692
	Depreciation	8,942		—			338			9,280
	Amortization of intangible assets	—		—			482			482
	Non-cash stock based compensation expense	2,306		—			4,300			6,606
	Disposition related and other costs	3,308		—			4,311			7,619
	Legal contingencies and fees	1,000		—			965			1,965
	Divested businesses	—		—			(2,243		)	(2,243		)
	(Gain) Loss on sale of businesses	—		—			(3,369		)	(3,369		)
Adjusted EBITDA		$	42,407	$	—		$	(10,375	)	$	32,032
		For the twelve months ended December 31, 2017
Reconciliation of Operating Income (Loss) to Adjusted EBITDA:		Tech-focused		Healthcare			Corporate & Other			Total
Operating income (loss)		$	38,462	$	(1,507	)	$	(14,090	)	$	22,865
	Depreciation	6,868		1,625			1,259			9,752
	Amortization of intangible assets	132		596			1,410			2,138
	Non-cash stock based compensation expense	2,940		255			5,413			8,608
	Impairment of fixed assets	—		—			2,226			2,226
	Costs related to strategic alternatives process	—		—			807			807
	Disposition related and other costs	1,641		741			2,364			4,746
	Legal contingencies and fees	—		—			739			739
	Divested businesses	—		(1,710		)	(3,206		)	(4,916		)
	Gain on sale of business	—		—			(6,699		)	(6,699		)
	Proceeds from restitution payment	—		—			(3,293		)	(3,293		)
Adjusted EBITDA		$	50,043	$	—		$	(13,070	)	$	36,973

14

		For the three months ended December 31, 2018
Reconciliation of Revenues to Adjusted Revenues		Tech-focused		Healthcare			Corporate & Other			Total
Revenues		$	37,987	$	—		$	—		$	37,987
	Divested businesses	—		—			—			—
Adjusted Revenues		$	37,987	$	—		$	—		$	37,987
		For the three months ended December 31, 2017
Reconciliation of Revenues to Adjusted Revenues		Tech		Healthcare			Corporate & Other			Total
Revenues		$	39,760	$	4,613		$	6,563		$	50,936
	Divested businesses	—		(4,613		)	(6,571		)	(11,184		)
Adjusted Revenues		$	39,760	$	—		$	(8	)	$	39,752
		For the twelve months ended December 31, 2018
Reconciliation of Revenues to Adjusted Revenues		Tech-focused		Healthcare			Corporate & Other			Total
Revenues		$	152,258	$	—		$	9,312		$	161,570
	Divested businesses	—		—			(9,312		)	(9,312		)
Adjusted Revenues		$	152,258	$	—		$	—		$	152,258
		For the twelve months ended December 31, 2017
Reconciliation of Revenues to Adjusted Revenues		Tech		Healthcare			Corporate & Other			Total
Revenues		$	158,398	$	24,354		$	25,198		$	207,950
	Divested businesses	—		(24,354		)	(25,131		)	(49,485		)
Adjusted Revenues		$	158,398	$	—		$	67		$	158,465

Segment Definitions:

Tech-focused: Dice, Dice Europe (ceased operations on August 31, 2018), eFinancialCareers, ClearanceJobs, and Targeted Job Fairs.

Healthcare:¹ Health eCareers

Corporate & Other:¹ Hcareers, Rigzone, BioSpace, getTalent, and Corporate.

¹ Health eCareers was sold on December 4, 2017, majority ownership of the BioSpace business was transferred to BioSpace management on January 31, 2018, the RigLogix portion of the Rigzone business was sold on February 20, 2018, Hcareers was sold on May 22, 2018, and majority ownership of the remaining Rigzone business was transferred to Rigzone management on August 31, 2018.

15

DHI GROUP, INC.
SUPPLEMENTAL DATA - REVENUE DETAIL
(Unaudited)
(in thousands)
	Revenue
	Q4 2018			Q4 2017			Change	$ Fx Impact
Dice (1)	$	23,952		$	24,930		(4)%	$	—
eFinancialCareers	8,340			8,412			(1)%	(206		)
ClearanceJobs	5,727			4,705			22%	—
Tech-focused, excluding Dice Europe	38,019			38,047			—%	(206		)
Dice Europe (2)	(32		)	1,713			(102)%	—
Tech-focused	37,987			39,760			(4)%	(206		)
Healthcare (3)	—			4,613			n.m.	—
Hcareers (3)	—			3,488			n.m.	—
Rigzone (3)	—			1,856			n.m.	—
BioSpace (3)	—			1,227			n.m.	—
getTalent (4)	—			(8		)	n.m.	—
Corporate & Other	—			6,563			n.m.	—
Total	$	37,987		$	50,936		(25)%	$	(206	)
	Revenue
	YTD 2018			YTD 2017			Change	$ Fx Impact
Dice (1)	$	94,438		$	101,471		(7)%	$	—
eFinancialCareers	33,758			32,480			4%	904
ClearanceJobs	21,086			17,342			22%	—
Tech-focused, excluding Dice Europe	149,282			151,293			(1)%	904
Dice Europe (2)	2,976			7,105			(58)%	242
Tech-focused	152,258			158,398			(4)%	1,146
Healthcare (3)	—			24,354			n.m.	—
Hcareers (3)	5,329			14,368			(63)%	—
Rigzone (3)	3,771			7,171			(47)%	47
BioSpace (3)	212			3,592			(94)%	—
getTalent (4)	—			67			n.m.	—
Corporate & Other	9,312			25,198			(63)%	47
Total	$	161,570		$	207,950		(22)%	$	1,193
(1) Includes Dice U.S. and Targeted Job Fairs
(2) Dice Europe ceased operations on August 31, 2018.
(3) Health eCareers was sold on December 4, 2017, majority ownership of the BioSpace business was transferred to BioSpace management on January 31, 2018, the RigLogix portion of the Rigzone business was sold on February 20, 2018, Hcareers was sold on May 22, 2018, and majority ownership of the remaining Rigzone business was transferred to Rigzone management on August 31, 2018.
(4) getTalent discontinued in the third quarter of 2017.

16